The Meyers report 07-19-2024 Fast 15
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00:00Good morning, everybody.
00:06Welcome to the Friday Meyers Report, FAST-15.
00:10It is July 19th, 2024.
00:14Overnight we had a massive technology outage, actually multiple outages.
00:20It was around the world, actually.
00:22They impacted airline flights, financial institutions, and medical facilities.
00:27Was this deliberate or accidental?
00:29Hard to say yet.
00:31However, Hanlon's razor is, never attribute to malice that which is adequately explained
00:37by sheer stupidity.
00:39However, sometimes they are out to get you.
00:41We will see.
00:42We will gather our own experts, and we will cover this subject shortly.
00:47In the meantime, six days ago, the Republican presidential nominee, former President Donald
00:53Trump, was almost killed.
00:55Six days later, he gave a 90-plus-minute speech to officially accept the nomination
01:02for president for the Republican Party.
01:05I don't know any other way to put it.
01:07The man is a force of nature.
01:11What else can we talk about today?
01:14This morning, let's depart from our normal discussion pattern.
01:17We're going to talk about what happened.
01:21President Trump referred to new policies regarding energy and global warming.
01:27I got basically two questions.
01:29Will his policies do any harm to us?
01:31Second, how will his policies help us in the life of the country, particularly in the ability
01:37to reduce the cost of producing food and heating our homes?
01:43First of all, is it going to do any harm?
01:45No, because you can't change the weather.
01:47You can't pass a law and expect the weather to change.
01:51Will it cause any harm?
01:52No.
01:53When it comes to energy supply and policy changes, we have seen record oil production
02:01in the United States here over the past year or so.
02:03I've been hearing pundits say, well, look, under the Biden administration, oil production
02:08is at record levels, which it is, but that's not due to any policymaking from the Biden
02:14administration.
02:15Well, it's in spite of them.
02:17In spite of them.
02:18A lot of it's just sheer ingenuity and good work with the folks who are producing oil.
02:23But what people don't understand, and I see people even who should know better, Biden's
02:30policies will affect oil production in the future because he's been limiting, restricting,
02:36or pulling back a lot of oil permitting.
02:40In the oil industry, you always have to be years ahead in permitting and exploring new
02:47ground and new places for oil.
02:49So while we are doing record production right now in oil and natural gas, policies that
02:55have been made over the last few years will make it harder for oil production in the future
03:00because of those restrictions.
03:02So if Trump is elected and those restrictions are put off, that's going to be good news
03:07for oil and gas.
03:09And also it should be mentioned that Biden closed liquid natural gas port in Louisiana,
03:15I believe, or Texas, I'm not sure, whatever.
03:18So energy policy will be different.
03:22And in the longer term, what Biden's administration has done is it's going to cause elevated oil
03:29prices because even with record production, we have to get those production things online
03:35years in advance and plan for them.
03:37So it's not going to be as easy as I think for energy policy to turn that ship around
03:43too quickly.
03:44Okay.
03:45Isaac, how are the freight markets recover?
03:51Are the freight markets recovering yet?
03:54Yeah, we're seeing the imports dramatically increase month over month.
04:00We year over year, June closed in at 14 percent, 14 percent higher in imports than same time
04:08last year.
04:10Already mid-July, Gary, we're at 18 percent increase from year over year.
04:15So the industry has done everything except for announce a full blown recovery.
04:21That's incredible.
04:22And how are the owner operators holding up?
04:25Even the owner operators, even the smaller companies who we've been reporting have been
04:28suffering this last two years, the entire two years, which they have, but even they're
04:33seeing some signs of relief.
04:35Owner operators went from working two, three day work weeks for the past two years to now
04:41they're still suffering from lower than average rates on the trade side, but at least now
04:46they're working a full work week.
04:49On the truckload side, now that's on the trade side, on the truckload side, we're starting
04:53to see spot rates, transactional freight that trades on load boards.
04:58We're starting to see spot rates rise above $2 a mile, which finally, this is the first
05:04time in the last 18 months that spot rates are actually north of operating costs.
05:10How much north?
05:11What's basically the cost of operating per mile?
05:14About a $1.90 a mile.
05:15Spot rates are about $2.01 today.
05:18Does a $1.90 include repairs to the trucks?
05:21Yes.
05:22Okay.
05:23What do you see, from what you heard last night, what is a Trump victory going to mean
05:28for the trucking and logistics industry and ultimately for consumers?
05:33I think overall, really, really good.
05:36Two big things, one pro, one con, consumer confidence we believe is going to roar and
05:42really, really make a strong impact on the transportation industry, but the con becomes
05:47what type of tariff he puts on China.
05:50When Trump was in office from 2016 to 2020, it wasn't necessarily great boom years for
05:55transportation.
05:5616 and 17 were pretty flat.
05:592018 was a great year, but that had little to do with Trump and had more to do with the
06:05electronic logbook mandate, which simply just cut down capacity because drivers were forced
06:12to drive with legal hours of service.
06:1519 went down as a bloodbath in our industry.
06:18Then we had COVID in 2020.
06:20In the industry, everyone's very optimistic and looking forward to a Trump victory, but
06:27we're also very worried about what type of policies he might do with imports coming in
06:32from China.
06:33Bob, weeks ago, we discussed the likely Trump policies, should he get in.
06:41It looks like he declared exactly what we thought he would, lower taxes, reduced regulations,
06:48getting rid of DEI, drill, baby, drill.
06:54The question is, it looks like we could have lower prices and a faster moving economy.
07:00There are a couple of questions.
07:01One is, what are your thoughts?
07:03The other thing is, we have to figure out a term that we will coin that is the exact
07:07opposite of stagflation because baby, it is coming.
07:12Go ahead, Bob.
07:13What do you think?
07:14Well, I think you're absolutely right.
07:16We've had a major shift in policies under President Biden, a shift toward taking far
07:25more control over the economy on the part of government.
07:29We've done that in the past and whenever we've done it, living standards have declined.
07:34The same thing happened this time.
07:36We are at a point where, let's say, President Biden or whoever takes over is going to win
07:44the election.
07:45Automatically, next year, we go back to huge increases in taxes, which would be an offset
07:54to the Trump tax cuts.
07:57People really don't realize that everyone's taxes would be going up, especially those
08:02in the middle and lower income groups.
08:04This would happen automatically because the Trump tax cuts would expire.
08:12That alone, if Trump gets in, is going to help the economy by preventing what I think
08:16would be an absolute disaster of everyone getting hit with a huge increase in tax burden.
08:23In addition to that, Trump is very set on reducing the regulatory burdens in the economy.
08:30Those regulatory burdens are extremely high.
08:34It's another reason why we tend to get lower living standards when we have the government
08:39doing more and trying to take over more of the economy.
08:42It's getting closer and closer to a socialistic, communistic economy.
08:47If Trump comes in, one of the first things he's going to do is work on that regulatory
08:53burden, taking it down.
08:55All of the savings from the increased efficiency there are going to go to the bottom line.
09:00That's why you get higher living standards when government steps back and allows the
09:05economy to work well.
09:07Bob, I remember during the Carter administration, when they put a big tax on luxury yachts,
09:14which they thought, okay, that's only going to affect the rich.
09:17Well, they got it wrong because the unintended consequence was, yes, the rich quit buying
09:23luxury yachts, and the businesses went out of business, and guess who lost their jobs?
09:32These people do not think about the unintended consequences.
09:36Guys, it seems to me, and looking back at last night, we saw, I saw, a changed President
09:46Trump, much more subdued, resolute, calmer, and a man who looked death, who basically
09:58almost died and recognized it and appreciated it.
10:02What are your thoughts?
10:03Don, do you have some thoughts on this?
10:07Yeah.
10:08I mean, what happened on Saturday, I think, changed the dynamic, but I tell you, there
10:14are so many more things that could happen between now and November.
10:18I'm cautious to make any predictions or where this is going.
10:23I think we got, it's a long, windy road, not a straight road to the election.
10:27I think there's a lot of surprises coming.
10:29Do you think there's some stormy weather yet ahead?
10:33Yeah.
10:34Yeah.
10:35I mean, I think a lot of people are thinking Trump's going to coast, and I'm-
10:39I don't think so at all.
10:41I don't think so at all either.
10:42So that's why I'm cautiously optimistic.
10:46No, it's going to be a battle, and I only wish more people would understand what's at
10:53stake in terms of the tax burdens, because really, if the Democrat, whoever it is, gets
11:01elected, we are looking at a substantial increase in all taxes, including the capital gains
11:07tax, which is the most potentially destructive of all the taxes going.
11:12So it's a whole new dynamic, depending upon the outcome of this election.
11:15And I would agree with Don.
11:17No one knows at this point in time, I'm interested to see that Trump and Vance are already coming
11:25to Michigan for another huge event tomorrow.
11:31So they're not taking any time off.
11:34Now, one of the things I noticed-
11:37And Biden's staying home with, he's staying home with the sniffles.
11:41Well, one of the things we noticed at the convention is an awful lot of people claiming
11:47that this was the hand of God that saved Trump.
11:50And I would just caution that the more you argue that, the more you incentivize people
11:57to take another shot at him and get him out of the way.
12:01So I don't think it's good to try and claim that God's hand was in this and that, and
12:07we don't know about that.
12:09But I also think that there are a lot of crazy people around that when they see you start
12:14mentioning God like that, are out to try and prove that this wasn't God's hand.
12:21And so I just pray and pray that our Secret Service will do a better job at protecting
12:27both of them as they go out fearlessly to spread the word around the country.
12:33Isaac, what's your take on this?
12:36I think Trump's learned, I think the last three and a half years, the ringer that the
12:40Democrats have put Trump through, I think he's learned a whole bunch and I think he's
12:45prepared to execute on everything he's told the American public he's going to do.
12:50I'm looking forward to it, Gary.
12:52I'm optimistic.
12:53Gary, one of the things that particularly struck me about what Trump said is during
13:00his speech, he talked about the time and effort that was spent going after he and his
13:07family and all every week, the subpoenas that each of them had to respond to.
13:14And the point that I thought was so exciting, he said, if all of this time and energy going
13:21after an enemy had been put to productive use, think of how much good could have been
13:27done for the country.
13:30I completely agree.
13:32I think that's a wonderful thought.
13:35And on that note, I would like to say, have a great weekend.
13:39Be well, stay safe, and God bless President Trump and God bless.